Monday afternoon saw Bitcoin (BTC) hit a month high of $40 539.39. The price surge also marked the first time the coin hit the $40K mark since June 16. Bitcoin went bullish after speculations that ecommerce giant Amazon would be venturing into the digital currencies space reached the markets.
The online retailer posted an ad sourcing for a "digital currency and blockchain product lead." The ad stoked up expectations that Amazon could soon be accepting cryptocurrencies as payment. However, the excitement would quickly fizzle out after the firm denied a media report suggesting that it would be accepting crypto payments by the close of the year.
London's A.M Newspaper had initially cited an anonymous "insider" report indicating that Amazon would be setting base in the crypto space by the close of 2021. The news sent the world's most capitalized digital currency up by close to 14.5% by yesterday afternoon. However, the gains were slashed 8% to settle at circa $37,000 as of this morning.
Amazon released a report saying that while the current rumors remain inaccurate, the company was keen on exploring the gains around digital assets and how the venture could impact its customers.
Should the firm solidify its plans, Amazon will not be the first global giant to dive into the digital currencies arena. Several other high-ranking firms are already reaping the benefits of decentralized currencies.
Early Cryptocurrency Adopters
Around seven years ago, Microsoft was among the early crypto adopters as a settlement method for its merchandise, including games, operating systems, and other digital content. You might recall in 2014 when Microsoft dived into the crypto world, established assets such as Bitcoin and Ethereum remained unknown and could primarily be heard for all the wrong reasons. During the same year, one of the largest crypto exchanges, Mt. Gox, collapsed following a slew of attacks and fraudulent undertakings.
At that time, only a single New York city bar reportedly accepted Bitcoin, plus a few other eateries and car services. Admittedly, only a handful of big companies openly talked about crypto, not to mention its adoption.
Perhaps no one would have imagined that a global company sitting at the core of digital funds transfer would come second to a software firm in cryptocurrency uptake. Unable to beat Gate's Microsoft to the game, PayPal started accepting Bitcoin in December 2014, just three months after the former. Contrary to its 'BTC' ticker today, Bitcoin was initially traded with the initials' XBT.' Back then, due to its low popularity, CNN would essentially describe the coin as a "decentralized, state-less currency."
And even when PayPal approved Bitcoin, its sole intention was to boost its platform's usage and not draw business to consumers. Its selling point was Bitcoin's tiny fraction of transaction fees compared to the typical 2-3% charged by credit card companies.
Etsy does not expressly accept Bitcoin as payment. However, it permits the sellers and buyers to transact using cryptocurrencies independently. The seller can include a different payment method at the checkout point for items purchased from their online store.
The buyer can then pursue that payment option and alert the seller regarding their preferred payment method – cryptocurrency, in this instance. A seller then accepts Bitcoin, Ethereum, NEXT, etc., as the agreed payment mode before sharing their wallet address to complete the transaction. Etsy published an entire page on how sellers can let buyers know they accept Bitcoin as payment.
A payments startup called Flexa in 2019 further broke the crypto dams when it joined forces with Facebook-owned firm Gemini. The partnership saw the duo grant companies access to crypto payments using digital scanners. So, for example, Apple Pay customers can now use their phone-based scanners to pay for items. In addition, participants can seamlessly convert crypto to fiat currencies such as Dollar, Euro, and Pound, and vice versa.
Among the biggest beneficiaries of this collaboration was Amazon-owned retail giant Whole Foods. Unfortunately, while Amazon primarily owns whole Foods, the latter is yet to incorporate crypto payments into its ecommerce platform.
The list goes on and on…
Research and multiple experts have indicated that the future of digital assets is yet to unfold as projected. And as with most forms of tech, the pandemic accelerated crypto's emergence.
A sneak peek at the future
The pandemic undoubtedly pushed most sectors to the digital zone. The virtual currencies space saw the growth of non-fungible tokens (NFTs) and decentralized finance (De-Fi) markets as people remained under lockdown. It is being stuck at home for months that led people to start playing around with digital assets. Stock markets were fast being overtaken by digital assets exchanges as traditional assets continued to decline. That notwithstanding and considering the rise in tech-based industries, the status quo might hold even beyond the pandemic.
Some economic analysts have argued that there is a likelihood that cryptocurrencies will soon be listed on conventional exchanges such as the LSE and Nasdaq. Furthermore, others say that all that cryptos need to step up are verified exchange-traded funds (EFTs). But then, while an EFT would ease investing in Bitcoin, it would still leave the crypto demand concern (beyond Bitcoin) unresolved.
In essence, the future of cryptocurrencies is subject to endless debates. Harvard University professor of Economics and Public Policy Kenneth Rogoff noted that the cryptocurrency market cap could soar in the next five years to $5-10 trillion. He further stated that Bitcoin's past volatility is "no reason to panic." However, the good professor quickly noted that this asset class is highly fueled by the transaction volumes and the overall market enthusiasm. These, he believes, will probably push Bitcoin to hit the $100,000-mark soon.